TRANSCRIPT
Australia's billionaires have been breaking wealth records.
Oxfam's new report, "Inequality Inc.", reveals the income of Australia's 47 billionaires has doubled to over $250 million in the last two years.
This represents more wealth in the hands of 47 people than around 7.7 million Australians.
Rod Goodbun, Oxfam Australia Director of Programs explains the report's main findings.
"The wealth of the three richest Australians has more than doubled since 2020, at a staggering rate of $1.5 million per hour. And that's occurring at the same time there's billions of people around the world really doing it tough. We know about the cost-of-living crisis in Australia, and there are many people around the world who've gone backwards at the same time as these millionaires and billionaires have continued to amass huge amounts of wealth. What we're seeing this year and in this decade is a galloping wealth amass and wealth concentration at the top end, while people are going backwards."
In Australia, people receiving income assistance are eating less or skipping meals due to the rising cost of living.
This has prompted calls for the Australian government to radically reduce the gap between the super-rich and the rest of society by changing the tax system.
But Brendan Rynne, chief economist and partner at KPMG Australia says the two issues are not related.
"There are in fact two different issues. What you've seen with regards to the billionaires improving their wealth status is essentially because the businesses that they've invested in have grown during the past few years at an incredibly strong rates. The cost-of-living crisis is something quite different. That's about inflation eating away at the real purchasing power of households. And clearly what you've seen is that for virtually every cohort in Australia their post-tax disposable income is less today than it was two years ago."
Even so, changes on the tax system will be made.
The Australian government is looking to implement a stage-three tax system on the first of July.
The measure will abolish the 37 per cent bracket and reduce the rate from 32.5 per cent to 30 per cent for all workers with incomes between $45,000 and $200,000.
This means that those with salaries slightly above the median of $100,000 would save more than $1300 in taxes.
Mr Goodbun says this will only benefit those at the top of the pyramid.
"Stage-three tax cuts will really benefit those at the top end the most. We know that people who earn over $180,000 a year will be the biggest winners from the stage-three tax cuts, they'll get about $9,000 extra. And what that means for the budget in the long term is that we're giving up potentially billions of dollars, tens of billions of dollars over the decade through those stages through tax cuts."
He says that better taxation of wealth is a much better start to reducing inequality.
"Taxing big fortunes would definitely help raise additional money. So, we argue for a wealth tax for millionaires and billionaires, and if we taxed millionaires and billionaires wealth at just 2% to 5%, we could raise $33 billion a year. And that could go to building 75,000 Social Housing, it could go to helping fund international development programs that would benefit our region and create a healthy and prosperous region for Australians to grow up in.
The end to fossil fuel subsidies and the implementation of a permanent windfall profits tax for large corporations are some other proposals made by Mr Goodbun.
Even so, Prime Minister Anthony Albanese says there is no interest in rethinking the stage-three tax cut.
"I'll make a few points. The first is that the Government's position hasn't changed. The second is that inequality is an issue and the Government has looked at ways in which we can improve that position. That's why measures such as strengthening Medicare, the measures that we have for cheaper childcare, all aimed at improving that position. Bear in mind that the stage three tax cuts start at $45,000. $45,000 if that's your annual income, you are certainly not wealthy.
Still, people in the top 20 per cent of the wealth scale hold almost two-thirds of all wealth in Australia, according to the Australia Council Social Service
With inequality remaining a problem in the country, Mr Goodbun says that only a change in the mindset of governments will be able to change reality.
"There is a real need for governments to step in and to take greater action to intervene. And one of the ways they can do that is to harness the resources, the wealth and money that's available out there in the system and provide that directly to programs that work to eradicate poverty, to help around health and education issues. So only governments can do this."
